The fraction of total income going to the wealthiest Americans
has increased significantly over the past three decades. The
highest earning tenth of households took home a little more than
one third of all pretax income in 1982. In 2012, that group
received half, research by University of
California at Berkeley economist Emmanuel Saez reveals.

As startling as the numbers may seem, income inequality shouldn’t
trouble those in Washington. Income is an outcome – a reward for
how hard people work and how clever they are. In a capitalist
society, if some people work harder or smarter than others, they
should earn more.

Moreover, differences in income per se don’t bother most
Americans. When people who start with little become rich because
of their efforts, few are troubled. No Op-Eds decry the billions
that WhatsApp’s founder Jan Koum earned by selling his start-up
to Facebook for $19 billion. Nor do they complain about the
billions that Warren Buffet made picking stocks, or the hundreds
of millions of dollars per year that Oprah Winfrey’s takes home
from her media empire. Getting from modest means to great wealth
is the American dream.

The real problem lies in declining opportunity for Americans to
move up the socioeconomic ladder. That’s where recent trends are
alarming. A shrinking fraction of Americans think they have the
chance to get ahead.

Between 2001 and 2014, the share of the population that believes
America affords the opportunity “to get ahead by working hard”
has trended down from 76 percent to 54 percent, a
recent Gallup Organization poll shows. Similarly, the Pew
Research Center found that, in 1999, 74 percent of Americans
agreed with the statement “most people who want to get ahead
can make it if they're willing to work hard.” In 2014, that
percentage had declined to 60 percent.

Moreover, Americans no longer think being rich or poor depends
primarily on individual effort. Back in 1964, when the Gallup
Organization asked a representative sample of Americans whether
“lack of effort on his or her own part or circumstances beyond
his or her own control” where “more often to blame if a person is
poor,” only 29 percent thought poverty resulted from external
forces. In 2014, a Pew Research Center/USA Today poll found that
fraction had increased to 50 percent. Similarly, the
share of Americans who believe that the economic system in
this country is “basically unfair” since “all Americans do not
have an equal opportunity to succeed” increased from 29 percent in 1998 to 44
percent in 2013, a Gallup poll revealed.

In his State of the Union address, President Obama turned from a
focus on income inequality to
inequality of opportunity. That shift is good news for
Americans who increasingly are looking for policymakers to
address the problem. Unlike income inequality, which is more
problematic to Democrats than Republicans, a recent Gallup poll
showed that equal fractions of Americans from both parties are
unhappy with the current level of
inequality of opportunity.